PPC Revenue is Finally Expected to Rebound in 2010 With Google Being the Prime Beneficiary

After an exceptionally long drought in which many saw their PPC revenue drop by 75% or more,  evidence is mounting that domain owners will finally witness an end to the carnage in 2010. The latest indication of an upturn came today when Jefferies stock analyst Youssef Squali raised his price target on Google stock (already rated a buy) from $600 to $695 a share (Google closed at $593 today).

Citing increased optimism among advertisers amid an improving macro environment, Squali noted "Our channel checks point to strengthening advertising, e-commerce environment and improving fiscal 2010 outlook, which bodes well for Google. Over 65% of online ad budgets continue to go to Search, with Google claiming the lion's share."

Squali added "Commentary out of Yahoo, AOL and Value Click last week also points to strengthening demand from advertisers." As almost all of you know, Google and Yahoo provide the vast majority of the PPC income received by domain owners.

Adding to the optimism is the fact that online sales were up 3% from November 1 to December 6 indicating that holiday season e-commerce is bouncing back, at least modestly, from last year when it fell 3%. 

The big question now is how much of an ad spending increase will filter down to domain 

owners?  After the massive losses incurred over the past year, a 5-10% up tick wouldn't prompt many people to pop champagne corks, but at least it would be a step in the right direction. It will take many more steps to get back to where we were, but as Lao Tzu, the father of Taoism, said, ""The journey of a thousand miles begins with one step." If we can get back up from the canvas and start walking again in 2010, maybe we will eventually be able to break into a sprint.

Regardless of what happens, the enduring lesson from this downturn for domain owners should be to continue looking for ways to diversify and end your dependence on Google and Yahoo. A parking revenue comeback would be most welcome, but if you can find new sources of revenue from your domains, the next inevitable downturn won't have to be as debilitating as the current one has been for so many.